Uranium One gives unchanged outlook for 2019

19 February 2019

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Uranium One will focus on ensuring that all of its operating uranium mines in Kazakhstan remain at "optimal production" over the next year, it says in its latest quarterly report. Its total attributable production for 2018 was 4383 tU.

Uranium One's Kazakh operations (Image: Uranium One)

Production at each of the company's Kazakh projects - Akbastau, Akdala, Karatau, Kharasan, South Inkai and Zarechnoye - was lower than nameplate capacity, and is expected to remain at similar levels in 2019.. Production at Willow Creek in Wyoming, USA ceased in July 2018 as the operation was transitioned to care-and-maintenance, contributing 10 tU to Uranium One's total for the year. All of the operations use in-situ leach methods to recover uranium.

Exploration activities at Zarechnoye will continue over the next two years, with a view to providing updated resource estimates, the company said.

At the end of 2018 Uranium One had sales contracts for a total of 17.4 million pounds U3O8 (6693 tU). Of that, 0.8 million pounds was contracted at an average price, after estimated escalation, of about USD74 per pound. The remainder of contracted sales are related to the market price of uranium at the time of delivery, or delivered at fixed prices. Uranium One said it currently has floor price protection for 6.5 million pounds of contracted sales at a weighted average floor price of USD33 per pound.

The sale of 15% of Kazakh state-owned uranium producer Kazatomprom in a dual-listing offering in November, and the acquisition by Kazatomprom of Energy Asia (BVI) Limited's interests in the Kharasan projects, were identified by Uranium One as recent supply-side developments. This saw Kazatomprom's equity interest in the Kharasan 1 uranium project increase from 34% to 50%, and its interest in the Kharasan 2 (Baiken-U LLP) project increase from 5% to 52.5%. Uranium One has a 30% indirect interest in the Kharasan mine through a 30% interest in Kazakh limited liability partnership Khorasan-U.

Uranium One is based in Canada and is a wholly-owned subsidiary of Russian state nuclear corporation Rosatom. It is responsible for Rosatom's uranium production outside the Russian Federation, with a portfolio including the Mkuju River conventional uranium mine project in Tanzania as well as its ISL interests in Kazakhstan and the USA. The works programme at Mkuju River is currently suspended.